The ability to understand social norms serves as an important means by which young children navigate themselves through complex social interactions. How children learn and practice these norms, especially fairness, one of the key concepts of morality and a core foundation of our society, continues to be a hot topic in the literature within developmental psychology. Although the general ontogeny of moral development has been well documented, emerging evidence suggests complex social contextual information that qualifies the developmental and cultural variances in the development of understanding. However, the lack of systemic investigation of the complex social influences on children’s fairness understanding is a pressing issue that needs to be addressed in the field. Therefore, this thesis sets out to explore how children from different age groups and cultural backgrounds understand, evaluate and apply fairness rules in their dynamic social interactions, in order to provide a more complete understanding of children’s emerging grasp of fairness and the role of social context in achieving this. The first study examined the interaction of six influences that have been shown to affect children’s fairness allocations: three structural factors (age, gender and culture: the UK vs China) and three contextual manipulations (whether equal allocation incurred a cost whether a trial involved competition, or was with a friend or an unknown peer). The data suggest that we need to take into account the interactions between these variables and the paper develops a dynamic model to describe this complexity in children’s fairness understanding. The statistical interactions revealed the complexity of social influences on children’s fairness allocation, specifically older Chinese females were more likely to apply the fairness principle across different contexts than children in other age and cultural groups. At the same time whether being fair incurred a cost to the child was found to be important. This influence was captured in a Dynamic Cost Model to account for how children balance of self-interest and principles of normativity. The second study capitalised on the first study and looked beyond these behavioural data to further examine children’s justifications of their allocations in order to identify the underlying principles that guided children’s distributions. The diversity of children’s justifications that was found in the second study provided clear and direct evidence to support our first study. Children’s fairness considerations changed systematically in response to the context of the allocations. The third study focused on one particular social factor, authority, that emerged frequently in children’s responses when they allocated resources, to analyse how social norms are developed from simple imitation to the implementation of specific principles based on children’s own understanding. The results from the third study suggest that despite the finding that more acceptance was given to an allocator with higher authority, children questioned an authority’s legitimacy when they made unequal distributions. This was especially the case when they were treated disadvantageously: normative related thinking was provoked immediately. Children’s social understanding ability, often termed as social understanding or ‘theory of mind (ToM)’, influence children’s fairness development informed the final research question of this thesis. An under-investigated age group, two-year-olds was included in the sample to assess children’s judgements along with their emotional responses to three types of distribution (fair, advantageous and disadvantageous inequality) in relation to multiple aspects of ToM abilities. The fourth study reported a positive predictive effect of social understanding on children’s fairness understanding, and that the emotional response from young children was a meaningful indicator of their complex evaluations regarding fairness allocations. The findings of this thesis suggest that social contexts heavily affect children’s fairness understanding and behaviour. These provide a medium in which developmental stage and cultural background interact. Children’s fairness development is the process of weighing self-interest and these dynamic social pressures